RFA to Australia: Choose ethanol, not petroleum reserve

The Renewable Fuels Association encouraged Australia’s energy minister to strongly consider U.S. ethanol imports as a cleaner, more affordable alternative to purchasing oil from the U.S. Strategic Petroleum Reserve.  According to RFA, opening the Australian market to ethanol imports would be good for the continent’s economy and air quality, and would help spur more rapid development of a domestic biofuels industry.

The letter, from RFA President and CEO Geoff Cooper, cited news reports of Australia’s request for access to the U.S. Strategic Petroleum Reserve “as a hedge against potential oil supply disruptions that appear increasingly likely given the volatile situation in the Strait of Hormuz.” Ethanol is a better option to protect Australian consumers from supply shocks, Cooper said.

Cooper wrote that part of the challenge Australia is facing with renewable fuels growth— biofuels represent less than 2 percent of the country’s liquid transportation fuel supply—is the result of the 5 percent tariff and customs tax of A$0.401 per liter for ethanol imports. “These severe measures have made fuel ethanol imports generally uncompetitive with gasoline and domestically produced ethanol,” Cooper wrote in his letter to Angus Taylor, Australia’s Minister for Energy and Emissions Reduction.

“Removing or at least significantly reducing the tariff and custom tax barriers to imported ethanol does not necessitate a complex negotiation with the U.S. government over our Strategic Petroleum Reserve,” Cooper added. “Nor will it take much time.  U.S. ethanol is available today for export to Australia.  … U.S. ethanol can provide near-immediate relief to your transportation fuel supply shortage with the added benefit of providing Australia with a tangible demonstration of its commitment to carbon reduction.”

Increasing ethanol use makes   more sense than tapping into more petroleum imports, Cooper also wrote, especially since Australia is a seeking to reduce its carbon footprint as a party to the United Nation’s Paris Agreement. When it comes to carbon reduction, ethanol is the clear winner over fossil fuels.

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